Construction of corporate governance and ESG culture

Sustainability is no longer just measuring and controlling impacts, it is organizing processes and managing complete governance. Understand how to apply the ESG culture in your company and the importance of building corporate governance.

por NTICS | 24 de July de 2020

Three letters are changing the market and concepts are becoming increasingly essential for companies that wish to be perennial and stand out in long-term. The term ESG (Environment, Social and Governance) represents the basic pillars of sustainability and summarizes criteria for conduct of companies in areas that investors and consumers take into account: environmental, social and governance.

Market giants, such as the largest asset company in the world: BlackRock, the German Association of BVI Clean Energy Wire Funds and XP Investments in Brazil, have taken initiatives towards ESG culture and practices.

American multinational BlackRock operates by combining traditional investments with environmental, social and governance-related (ESG) ideas to improve long-term results. BlackRock’s vision is based on: “Companies with strong profiles on material sustainability issues have the potential to outperform competitors who do not do the same. In particular, we believe that companies managed with a focus on sustainability should be better positioned compared to competitors and prepared to face adverse conditions, while still benefiting from positive market environments. ”

From 2014 to 2019 the volume of assets managed in sustainability funds in Germany doubled from 15 to over 30 billion euros according to Frank Bock, C.E.O of Clean Energy Wire. The share of funds managed under sustainability criteria, which measure the impact of financial activities on environmental, social and governance (ESG) aspects, represented about 3% of the total volume of retail funds at the end of 2019, earning up to 4 billion euros in volume per year.

In Brazil, in June 2020, XP Investiments launched the first ESG fund that invests in companies with good social and environmental impact practices. The broker launched this month (July) a second fund with an investment of R$ 100 million to stimulate the ESG market called Selection ESG.

Environmental and social factors are a little more understood by companies, but the pillar of Governance may still seem “nebulous” and must be implemented to transform the business into a sustainable company. What does sustainable business mean and why is governance so important? A company is characterized as sustainable when it includes all stakeholders and does not take net profit only to shareholders, also thinking about the customer, supplier, employees and the community that is in the surroundings, that is, in the entire chain to which it belongs.

Corporate governance is nothing more than the system that guides companies and organizations, through monitoring, process implementation and transparency, facilitating access to resources and contributing to the company’s longevity. There are 04 basic principles that permeate corporate governance practices:

Transparency: Make information available to all stakeholders by also sharing data, policies and values that are not in laws or regulations. Contemplate all the factors that guide management actions, not only economic performance, but also processes that preserve and optimize the company.
Equity: Fair, ethical and equal treatment of all stakeholders considering their rights, interests, needs and expectations.
Accountability: Governance positions must account for everything that occurs within the organization and its performance in a clear and organized way, assuming responsibilities and consequences and fulfilling business goals (KPIs).
Corporate responsibility: Governance positions must manage the financial viability of the business, reducing negative externalities for the operation, increasing profit and mapping the market in the long term.

HOW NTICS PROJECTS IS INVOLVED WITH ESG AND MAINLY GOVERNANCE

NTICS has the ESG culture as a guide for all activities and processes. Since 2017 the company has contributed to the environmental pillar by offsetting CO2 from the impacts of its operation annually by planting the equivalent amount in trees. NTICS also embraces the “no paper” and “no plastic” policy, using no paper or plastic materials. The social pillar, on the other hand, is one of the most present within the company, since the Transformations area that includes all the projects we create and implement are directly linked to the UN Sustainable Development Goals and have a social nature – happening in institutions and public schools and city squares.

As already mentioned in other articles available on NTICS Projects LinkedIn, Refúgio 343 and support for the Sustainable Amazon Foundation (FAS) are also initiatives directly linked to the environmental and social pillars. On our website it is possible to understand everything about the business commitments and movements supported by NTICS.

The corporate governance pillar is present as a mandatory mechanism to sustain and organize processes, optimizing time and improving the productivity and quality of everything that happens within the company. In addition, the four governance principles mentioned above are part of the essence and culture of NTICS Projects – we always work with transparency, equity, accountability and responsibility. Finally, a new product and business unit for the company will be launched next month in the USA: a 100% digital consultancy, lasting 30 days, which will transform small and medium-sized companies into totally sustainable businesses.

“Trend experts pointed out in recent years the global increase in ESG funds, I am happy to see the agenda at the center of the discussions. In NTICS deliveries, both with projects and consultancies, we make it clear and transparent which SDGs are applied and how each client can improve or develop their ESG indices. Making the theme tangible in a practical way, this is also our mission to attract sponsorships and create innovating Social Responsibility projects. ” – Marília Verdugo Head of Innovation and Quality at NTICS Projects.

Implementing the ESG culture in companies becomes a necessity, not just an option. We live in the era of the new generation engaged with PURPOSE and TRANSFORMATION. Global data and research are pointing out that both consumers and investors prefer companies that work with sustainability indexes and transparent processes. Do you want to understand how to build corporate governance and embrace the three pillars of sustainability? Contact us: Whatsapp or email: contato@ntics.com.br

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